Japan bail-in

[cr1776]

I hadn't seen this discussed last week, but it appears that Japan is following the EU/Cyrpus lead and going to require bail-ins IF needed at any point.  Hopefully no banks in Japan will need it, but if so, now would be a good time for Japanese to diversify some into non-seizable assets:

"Japan’s Financial Services Agency will enact new rules that will forced failed bank losses on investors, if needed, via a mechanism known as a “bail-in,” according to The Nikkei. Mitsubishi UFJ (MTU), Mizuho Financial (MFG) and Sumitomo Mitsui (SMFG) are among those proposing amendments to allow them to issue the types of preferred shares or subordinated bonds that would be used in such cases, the report noted."

http://www.forexlive.com/blog/2013/06/11/japan-to-become-more-like-cyprus-bail-ins-for-japan-banks/

[ScaryHash]

The radiation addled brain of Mrs. Watanabe will not mind if she gets fucked again, and again, and again.

After all, her husband is a workaholic who can't get it up. (Mrs. Watanabe is the generic name for the bond owning, conservative Japanese housewife who runs the house and probably the finances, while the husband works).

You are right, Japan is going to do whatever it takes to keep those banks solvent. However, the problem is that each bank is part of a network of keiretsu, vertically integrated set of companies with interlocked business relationships, shareholdings, and shareholders.

However, in this particular case, the keiretsu's have been holding up the Japanese economy for a long time, and will also cause it to come crashing down, because in Japan everything is inter-related, more so than in Europe and the US.

The fireworks show should be quite fascinating to watch.

[edmundedgar]

Detail here:
http://www.ft.com/intl/cms/s/0/5a5aa406-d33e-11e2-95d4-00144feab7de.html#axzz2WSPUoF1n

Looks sensible, doesn't it? There's no change to the basic deposit guarantee: Depositors are already only protected up to 10 million yen (about $100 K USD). This is generally pretty well-known here, because several banks (including mine) went bust (and got nationalized) in the late 90s, and they temporarily removed the ceiling to guarantee all deposits, then put it back once the crisis was over. Both changes were big news at the time.

This proposal doesn't seem to change that - the idea is that banks can (must?) create a new kind of security that you can buy if you want to - effectively people would volunteer to insure them against running out of money. If you buy those securities and the bank is OK you'll make better returns than if you'd just been a regular depositor, but if the bank runs out of money (as judged by the regulators) you lose it all.

It sounds like everyone is going to do something like this, which will be much better than the status quo, where once the bank runs out of money either taxpayers or > 100K depositors get screwed.

[Branny]

I think that more countries are doing this, no one wants to be the last as it is seen as a way to make the country *look* more financially secure.

Not much of a peep has come out of Cyprus in the long term. People ate the poison and have moved on.

[legitnick]

Japans currency is inflated to hell. Its about time japanese embrace Bitcoin as the new nations currency

[n8rwJeTt8TrrLKPa55eU]

Kyle Bass presentation + QA at Altegris conference May 23rd.  Mostly an update about his bet against Japan.  Prognosis is that the inflection point has now been hit, and unraveling is poised to accelerate suddenly at some point within next 2 years.

http://www.youtube.com/watch?feature=player_embedded&v=gJfvLADP3HE

[cr1776]

Hi,
Just to be clear, I don't think you have to subscribe - you just have to register and then you get a certain number of free views per month.  It isn't as nice as no registration, but at least some are free.   

Detail here:
http://www.ft.com/intl/cms/s/0/5a5aa406-d33e-11e2-95d4-00144feab7de.html#axzz2WSPUoF1n
...

Ffs, FT shown great support for Bitcoin in its articles so why the hell aren't they accepting it for their pay wall?? I don't want to subscribe to the damned thing, I just want to pay a few mBTC to not have to hunt down a cached version for free.

Sry, rant over. Must re-read the history of banks in Japan, I thought they where more or less forced into using western banking practices at the start of their prosperity and that's more or less the cause of this problem. Good luck to folks over there, hope everyone can see the way the wind is blowing and get their funds into something real before the storm hits.

[byronbb]

FoRex trading is very popular amongst Japanese housewives collectively referred to as Mrs Watanabe.